When Ford SA begins its vehicle export programme next year, its products could be sent through Maputo in Mozambique instead of a local port. What is Trade and Industry Minister Alec Erwin’s opinion on the matter?

When the Ford Motor Company of SA (FMCSA) begins its vehicle export programme next year, its products could be sent through Maputo in Mozambique instead of a local port. What is Trade and Industry Minister Alec Erwin’s opinion on the matter?


CARtoday.com reported on Tuesday that the Silverton-based manufacturer had revealed details and the size of the respective export contracts following a recent announcement of a R1-billion investment programme in the local subsidiary of Ford.


A spokesman for the company said production would start on two new vehicles and the value of its additional exports was expected to reach R4 billion a year.


"The initial export programme, a commercial vehicle with volumes of 2 700 per annum, will begin in the third quarter of 2004," the company said. "The second, a passenger vehicle with volumes of about 41 000 a year – 30 000 of which will be exported – will start in the first quarter of 2005."


Production parts to support an estimated 70 000 vehicles per annum will be exported from local suppliers to other international markets. Service parts will also be supplied to a number of Ford's international operations.


However, FMCSA (and many local exporters, for that matter) are concerned about South Africa's congested infrastructure, reported on Wednesday. In addition, Maputo’s port has emerged as a competitive port especially in terms of its capacity.


A Ford SA executive who asked not be identified told the ‘paper: "We don't have to decide just yet, but we are looking at both Durban and Mozambique. It might be a good thing for Durban, which is already showing the strain, if we did not add to the burden with our own planned programme, which will involve 30 000 units from early 2005”.


There was also concern that Durban was expensive. Mozambique was close to the company's Pretoria plant and was likely to offer a competitive rate, the spokesman said.


Deloitte & Touche automotive industry expert Duane Newman said it would not be a tragedy if Ford were to choose to export through Mozambique - an option that BMW SA has also been studying. "It might not be such a bad thing if it were to relieve the congestion at ports like Durban," he said.


Trade and Industry Minister Alec Erwin, who visited Ford's Detroit headquarters during a recent visit to the US, on Tuesday welcomed the announcement of Ford's export programme.


"It is not always easy for the assemblers to take the decision," he said, adding that he had been "grilled" by Ford management during his visit to Detroit.


On the issue of ports, Erwin acknowledged that SA exporters faced logistical and especially congestion problems at the country's harbours, but pledged that "the ports would be made more efficient. We will sort out our logistical problems."


Meanwhile, Nico Vermeulen, the head of the National Association of Automobile Manufacturers of SA, said that the Ford announcement was "excellent news" for both manufacturers and the local vehicle component industry.


"It is noteworthy that this is a major investment by a US automotive company in SA a sign of confidence by the Ford Motor Company in SA's future and in its technical capabilities," he said.